- GBP/USD dips as market reacts to global tensions and hot UK inflation data.
- Technical indicators suggest further downside, with the pair now below the 200-day SMA.
- Key support levels to watch include 1.2600 and May’s low at 1.2445, with potential for retesting annual lows.
- Recovery above 1.2665 and the 200-day SMA would be crucial for reversing current bearish momentum.
The Pound Sterling tumbled against the US Dollar early during the North American session as traders digested the escalation of the Russia-Ukraine conflict, the result of the US Presidential Elections, and hot UK inflation data. The GBP/USD trades at 1.2624, down 0.21%.
GBP/USD Price Forecast: Technical outlook
Further downside is seen after the GBP/USD pair dropped underneath the 200-day Simple Moving Average (SMA) at 1.2818. In addition, the major carved out a successive series of lower highs and lower lows, clearing on its way to intermediate support at 1.2665, the August 8 daily low. That and oscillators such as the Relative Strength Index (RSI), which indicate that sellers are in charge, confirm the pair’s bearish bias.
The next support level is seen at 1.2600, followed by the daily low of May 9 at 1.2445, before testing the year-to-date (YTD) low of 1.2299.
If buyers want to regain control, they need the GBP/USD to climb above 1.2665, followed by 1.2700 and the 200-day SMA.
